FMD Capital Management

Closed End Funds

Presentation: Generate High Income And Alpha Using Closed-End Funds

Written by David Fabian, May 18th, 2017

I was fortunate enough to be invited to speak at the Las Vegas Money Show this week and chose to deliver an educational presentation on closed-end funds (CEFs).  My focus was on the right way to analyze, select, size, and trade these unique investment vehicles.

There are a number of advantages to using CEFs in your portfolio – from bolstering your high yield exposure to tapping into an active investment managers’ prowess.  Whatever your goal may be, these tools can be an effective way to generate income and alpha when used correctly.  Below are the PowerPoint slides from my presentation that you can download to view.

May 2017 CEF Presentation Slides

Global Equity CEFs Are Hot – Should You Buy?

Written by David Fabian, April 28th, 2017

The hot hand in the closed-end fund marketplace this year are global equity funds.  These diversified portfolios own a mix of U.S. and international stocks with the added boost of embedded leverage.  Some also employ options or other derivative strategies to generate a portion of the abundant income that is distributed to shareholders. Read more

5 High Yield ETFs of CEFs For Tactical Income Investors

Written by David Fabian, April 07th, 2017

Many investors are making the right choice to build their core portfolios around low-cost, liquid, and diversified ETFs geared towards dividend paying stocks and bonds.  These funds provide transparent exposure to a broad range of asset classes without the drag of high expenses.

While this core exposure is important, there may also be a desire to further diversify your holdings towards alternative investment styles with a penchant for higher yields.  This is the foremost objective behind ETFs that invest in a basket of closed-end funds (CEFs).  Read more

3 CEFs for Tax-Efficient Total Return

Written by David Fabian, February 10th, 2017

Income investors with large taxable accounts are consistently focused on maximizing their total return and minimizing the impact of taxes on their nest egg.  That means seeking out funds that are sensitive to the type of income they produce and the implications of using capital losses to offset gains.

Exchange-traded funds (ETFs) are one avenue for investors to consider in this pursuit.  Many ETFs that track a passive index have low portfolio turnover rates and often pay little to zero capital gains at year-end.  These make for a truly inexpensive and effective vehicle for tax-conscious investors that want diversified stock or bond exposure. Read more

VIDEO: Closed-End Fund Market Update – Running Hot

Written by David Fabian, February 09th, 2017

This month’s video takes an in-depth look at the closed-end fund marketplace.  Charts include both diversified CEF indexes and single fund names.  Overall the trend remains solid, however we are starting to see stretched premiums and tight discounts across the entire spectrum.  Risk is high and caution should be warranted at this stage of the cycle.  Video recorded after the market close on February 8, 2017.

A log of our previous videos are posted here.

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